Its average gross refining margin dropped to $9.30 per barrel from $10.10 a year earlier, although it was up from the preceding quarter's $7.60. Net sales rose 13 percent.

Investors have focussed, however, on theoilandgasproduction business at Reliance,India's second most valuable company which is controlled by its richest man, Mukesh Ambani.

The upstream business, which is small relative to refining, has several concessions including the Krishna Godavari D6 block offIndia's east cost.

Gasoutput from the block has fallen sharply since 2010. The company says the decline is due to the geological complexity of the block, while the government says contractors have failed to drill the promised number of wells.

The block, in whichBPPlc has a 30 percent stake andCanada's Niko Resources 10 percent, currently produces about 13 million cubic metres ofgasper day, a government source said last month.

Reliance has said further investment at the field to reverse falling output would require a rise in domesticgasprices.

A formula that would have nearly doubled prices from April 1 was approved by the cabinet, but theElection Commissionlast month asked the government to defer the increase until the end of the five-week general election in the middle of May.

India's main oppositionBharatiya Janata Party (BJP), which surveys show is on course to become the largest parliamentary party, has said it will review thegaspricing formula if it is elected.

Reliance also has interests in areas including retail and telecommunications. Its retail business, which started at end-2006, posted its first ever annual profits before depreciation, interest and tax at 3.63 billion rupees.

"The retail business has turned around and is nowIndia's largest retail chain," Chairman Mukesh Ambani said.

The group expects a compounded annual growth rate of 25 to 30 percent for its retail business in the next two to three years, TV channel ET Now cited the company as saying.

Reliance has spent billions of dollars on a 4G mobile telecoms venture, which has yet to be launched. It said it had accelerated efforts to roll out 4G services.

The company aims to capture a big share of the fledgling but growing wireless data market by offering low-cost services. It recently added airwaves that would help it offer bread-and-butter voice telephony along with premium high-speed Internet services.